Hi nightrider1981,
May I confirm some information to sort out this issue?
1. How many users are affected, all the users or some specific users?
2. I’d like to confirm which of the following is true.
a. These users are always “In cloud”
or
b. They were previously “Sync with active directory”. Suddenly, they become “In cloud”.
Have you ever deactivated Directory Synchronization? If DirSync is deactivated/disabled, the users will not be synced with AD, and the status is “In cloud”. If this issue occurs when DirSync is running, I suggest you perform the following steps to narrow down this issue.
1. Create a new test AD user, and synced this user to Office 365 to check the result.
2. Check related Event log on the DirSync server, and post related screenshots for analysis.
Thanks,
Young